Digital marketing, which reaches customers interactively through web, mobile and social media, is in rapid ascendance. But not all companies – and, more importantly, their marketing departments – have embraced the creative opportunities that social media offer.
While some brands are receiving awards and being celebrated for their innovative digital campaigns, others within the same industries have yet to launch their first digital campaign. So why is adoption across the industry uneven?
"Digital is potentially the most perfect form of marketing, but also one of the most difficult," said a participant at a recent expert discussion on digital marketing maturity. The event was held under the Chatham House rule, which means quotes are unattributed to encourage freedom of debate.
The roundtable panel looked at why some companies are forging ahead with digital and social media marketing, while others are hanging back. It also dealt with some searching questions, such as: can you prove that digital marketing is a sound investment? How are marketing professionals and agencies coping with the technical challenges? And what will marketing look like as digital marketing matures?
The roundtable began by discussing the Cannes Lions Festival of Creativity, an annual event in June where creative, PR and marketing professionals meet to discover who is to receive the coveted Lions awards for innovative campaigns, and to attend presentations on successful marketing. Participation at Cannes Lions now goes beyond marketing agencies because of the importance of digital marketing. But uneven representation shows how some brands are resisting the digital push.
"Cannes is where there is a whole bunch of pioneers in marketing and digital, and we had to strong-arm our business to be there. There are more non-agency people there: Google, Microsoft, Facebook and Twitter. Then we noticed more brands going than we expected, but the numbers per company varied greatly. Some brands, like BP, GSK [GlaxoSmithKline]– maybe some of the banks – had no interest – whereas for others, like Shell, it was a mandatory part of their year," said a panel member.
At the heart of marketing
"Digital in terms of media spend is increasing year on year. It's not thought of as an add-on any more. More often, it's ingrained from the beginning. It should be as well, it's the fastest-moving medium now," said another participant.
Technology is at the heart of marketing now, participants agreed, changing the skills necessary to create and run a campaign – and the companies likely to be involved. "Ten or 15 years ago, a digital agency was the poor relation, fighting for budget against the advertising agency, public relations and direct marketing," a panel member observed, whereas now, technology companies such as Google are also around the table. "To get anything done, you need three technology firms, a couple of agencies and the internal brand team."
Agencies and brands now need to collaborate with technology firms. "Media agencies go out and meet media owners like Google, who have new technology," the panel heard. "They suss out what is coming up and how they can be the first to work with them."
But how do you justify the cost? "The senior management team just wants [financial] results. You have to prove it. How many leads did you get? They don't care how many people read a blog or are following a twitter account," said a participant.
Such an approach is a mistake, said others. One contributor warned against "just talking to people at the end of a decision journey". Instead, it is a matter of getting into the evaluation process.
Much is still unknown. "With digital we can look at billions of touches, but not necessarily the value of those touches," said one panel member. "The fact you can get great data about digital, makes us imagine that there's an algorithm for successful digital outcomes" – but that is not necessarily true. "The purchase process has completely changed and the linear processes we used to perceive markets as working in are no longer the case."
One way of making the value of digital marketing more tangible is through brand valuation. "It tells you what you need to do more of to get your brand value up," said a participant. But how do you measure brand value? It is a matter of bringing three data points together, the room heard.
The first is a five-year financial-profit forecast. Next, there is an evaluation of how important the brand is in driving demand in a particular market. "In luxury goods, it's very important; in agrochemicals, it's less important, for example," said the participant. Finally, "there are 10 brand-strength factors, which are scored on a relative basis to the competition. If you do that on a regular basis, you will be able to track how it is that you've produced your brand value".
One advantage of digital marketing is that it generates plentiful data for analysis, but relatively few companies are taking advantage, according to a panel member.
"Companies like Burberry, News Corp and Expedia, they're stretching the vision of what's possible and getting the numbers and analytics. My concern is with the rest of the market that isn't doing this stuff at all yet. I was at a meeting with a manufacturer of tools and they didn't even think social-media listening was legal."
Mobile is pervasive in digital marketing. "You have to assume that any content you produce will be ingested through any device," said a panel member. "I believe more in mobile than I do in apps. The content has to be renderable, usable, helpful. It is about the right device for the right time, for the right message." That said, it is not mobile itself that counts, but finding the right channel for the target market.
"You need compelling content and then a means to get that to the stakeholders," the room heard. "A great example is the Burberry Kisses campaign, a collaboration between Burberry, Google and agency. It was an app that meant you could kiss your phone and send the image of your lips, underneath Burberry branding, to the recipient of your choice. How does kissing your phone have anything to do with Burberry? Who cares? It could have been a bank, it could have been anybody doing that, but it was a great piece of content."
What, then, is the future of digital marketing? This is not just a marketing question, but also touches on customer service and privacy issues. "I know what I want to have, as a customer," said a panel member. "I want to be able to have my communications via email, via twitter, via phone calls all in one, so I'm only having one conversation. I know there's a creepiness factor there, but I do think that is the ultimate in customer service."
Greater use of personal data is inevitably part of the future of marketing. "As consumers, we're putting so much information about ourselves out there. The brands that serve us better use it in a relevant manner," said a participant. "If I put on twitter that something I'm using is broken, I want the brand to pick that up, call me back, and I don't want to repeat what the problem is." This is part of a wider trend towards greater interaction between businesses and customers. "The old days where brands used to preach at consumers and expect them to meekly follow the message have gone," said one expert.
As for marketers, making sense of digital is still a challenge. "The race to digital marketing maturity is still at an early stage. The next big demand is to integrate the fragmented tools, integrate the channels, integrate the approach in terms of agencies working with software vendors," said a participant. The race, it seems, will only be won when the phrase "digital marketing maturity" is no longer uttered – and digital's role within marketing is assumed.
At the table
Jemima Kiss (Chair), Head of technology editorial, the Guardian
Rosanna Duncan, Creative Ideas Lab, MEC Global
Simon Hall, Senior marketing director, Dell
Laura Robinson, Creative Ideas Lab,MEC Global
Justine Arthur, Head of communications and campaigns, BT
Graham Hales, CEO, Interbrand
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